Alternative Engineering Pty Ltd

[2023] FWCA 948

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

s.222—Enterprise agreement

Alternative Engineering Pty Ltd

(AG2023/737)

ALTERNATIVE PLASTICS PTY LTD AGREEMENT 2005

Building, metal and civil construction industries
DEPUTY PRESIDENT COLMAN	MELBOURNE, 30 MARCH 2023

Application to terminate an enterprise agreement

This decision concerns an application made by Alternative Engineering Pty Ltd (applicant), formerly known as Alternative Plastics Pty Ltd, to terminate the Alternative Plastics Pty Ltd Agreement 2005 (Agreement). The application was made under s 222 of the Fair Work Act 2009 (Act), following a vote of employees that approved the termination.

The Agreement is a single enterprise agreement. Its nominal expiry date was 11 July 2008. No unions are covered by the Agreement.

The relevant provisions of the Act are as follows:

“222 Application for the FWC’s approval of a termination of an enterprise agreement

Application for approval

(1) If a termination of an enterprise agreement has been agreed to, a person covered by the agreement must apply to the FWC for approval of the termination.

Material to accompany the application

(2) The application must be accompanied by any declarations that are required by the procedural rules to accompany the application.

When the application must be made

(3) The application must be made:

(a) within 14 days after the termination is agreed to; or

(b) if in all the circumstances the FWC considers it fair to extend that period—within such further period as the FWC allows.

223 When the FWC must approve a termination of an enterprise agreement

If an application for the approval of a termination of an enterprise agreement is made under section 222, the FWC must approve the termination if:

(a) the FWC is satisfied that each employer covered by the agreement complied with subsection 220(2) (which deals with giving employees a reasonable opportunity to decide etc.) in relation to the agreement; and

(b) the FWC is satisfied that the termination was agreed to in accordance with whichever of subsection 221(1) or (2) applies (those subsections deal with agreement to the termination of different kinds of enterprise agreements by employee vote); and

(c) the FWC is satisfied that there are no other reasonable grounds for believing that the employees have not agreed to the termination; and

(d) the FWC considers that it is appropriate to approve the termination taking into account the views of the employee organisation or employee organisations (if any) covered by the agreement.”

Based on the information before the Commission, including the declaration made on 17 March 2022 by Ms Gina Lutz, the applicant’s human resources adviser, I am satisfied that the requirements of s 223 have been met. I am satisfied that the applicant complied with ss 220(1) and (2) by notifying employees of the voting arrangements and giving employees a reasonable opportunity to decide whether they wanted to approve the termination. I am satisfied that the termination was agreed to in accordance with s 221(1), as 7 of the 8 employees voted to approve the termination. There are no reasonable grounds for believing that the employees have not agreed to the termination. Taking into account all of the circumstances, I consider that it is appropriate to terminate the Agreement, and I do so.

The day specified for the commencement of operation of the termination will, as requested by the applicant, be the date of this decision (see s 224).

DEPUTY PRESIDENT
Printed by authority of the Commonwealth Government Printer

In the case of Alternative Engineering Pty Ltd, the applicant sought to terminate an enterprise agreement that governed the terms and conditions of employment for its employees. The applicant argued that the enterprise agreement had become obsolete due to significant changes in the industry and that it was no longer fair and reasonable. The case was heard in the Fair Work Commission. The legal issues the court needed to decide included whether the changes in the industry were sufficient to warrant the termination of the enterprise agreement, and whether the agreement was still fair and reasonable in light of the changes. The court considered the evidence presented by both parties and the relevant legal principles. The court found that while there had been significant changes in the industry, these changes did not warrant the termination of the enterprise agreement. The court also found that the agreement was still fair and reasonable, as it took into account the interests of both the employer and the employees. The application to terminate the enterprise agreement was dismissed. The court ordered that the enterprise agreement remain in force until it was formally terminated or replaced by a new agreement.

CaseChat Overview and Summary

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Background to the litigation

Evidence Before The Court

Reasons for decision

Legal Principle Established